Income tax department claimed to have found discrepancies in the audit reports prepared by Aam Aadmi Party (AAP) for donations amounting to about Rs 27 crore.

The department has been investigating the donations list of the party for the last over an year. In a report submitted to the Election Commission, the department said that the records of donations made to the AAP during 2013-14 and 2014-15 had ‘factual discrepancies’ and did not match with the actual funds received by it from various donors.

All political parties prepare audit reports in consultation with their charted accountants, and submit a copy to the I-T department as per law.

The I-T report has suggested that the violations are in contravention of tax laws that govern political donations as stipulated under the Income Tax Act, 1961.

According to the department, this could form the basis for the cancellation of the tax exemptions given under the I-T Act to AAP and could also follow a stringent action of de-registration of the party, but all such decisions are the domain of the Election Commission exclusively.

However, AAP's national convenor and Delhi Chief Minister Arvind Kejriwal alleged that it was a "dirty trick" by Prime Minister Narendra Modi to get the AAP deregistered due to fear of loss in Punjab and Goa, which go to polls tomorrow.